If you thought the Beneficial Ownership Information reporting saga was over, it is not quite finished. While FinCEN exempted all domestic companies and their U.S. beneficial owners in early 2025, the reporting requirement remains fully in effect for foreign-owned entities registered to do business in the United States. If your business has foreign beneficial owners, you still have compliance obligations.
What Changed and What Did Not
The Corporate Transparency Act originally required virtually all small companies to report their beneficial ownership information to FinCEN. After a series of legal challenges, including a Fifth Circuit ruling and a Supreme Court decision, FinCEN issued an interim final rule in March 2025 that exempted domestic reporting companies and their U.S. person beneficial owners from filing. This was later reinforced by the OBBBA, which codified the domestic exemption.
However, the underlying statute still applies to foreign reporting companies: entities formed under foreign law that register to do business in any U.S. state or tribal jurisdiction. These entities must report the names, addresses, dates of birth, and identification numbers of their foreign beneficial owners who own 25% or more of the entity or exercise substantial control.
Who Is Still Required to File
You need to file if your entity was formed under the laws of a foreign country (regardless of which country) AND is registered with a secretary of state or similar office in any U.S. state or territory. Common examples include foreign subsidiaries operating in the U.S., joint ventures with foreign partners registered domestically, and investment vehicles formed offshore but registered to conduct business here.
If all of your beneficial owners are U.S. persons, you are exempt even if the entity itself is foreign-formed. The reporting obligation targets foreign persons who are beneficial owners of U.S.-registered foreign entities.
Penalties for Non-Compliance
FinCEN has been clear that enforcement is active. Civil penalties of up to $591 per day of non-compliance apply, and the agency has referred willful violations to the Department of Justice for potential criminal prosecution. The maximum criminal penalty is $10,000 and up to two years imprisonment.
What You Should Do
Review your entity structure to determine if any of your businesses fall into the foreign reporting company category. If you have foreign investors, foreign-formed holding companies, or any entity that was not organized under U.S. law, check whether it is registered in a U.S. jurisdiction. If so, confirm that your BOI filing is current and accurate, and that any changes in beneficial ownership have been reported within 30 days.
The domestic exemption simplified compliance for most U.S. small businesses. But if your structure includes foreign elements, BOI reporting is not optional.